Annual leave loading is an extra 17.5% on top of normal pay while a permanent employee is on paid annual leave, and under the Restaurant Award MA000119 it is also payable on untaken leave when someone leaves.
Skai Solutions publishes this because the three awards a hospitality business can fall under do not treat leave loading the same way, and the fast food one is not a flat percentage at all. Everything below is read off the award texts as they apply from the first full pay period on or after 1 July 2026. Rates change every 1 July and an enterprise agreement overrides the award, so check a specific person in the Fair Work Pay and Conditions Tool before you run a pay period.
Annual leave itself comes from the National Employment Standards, not from the award. Each award then adds a loading on top of the pay for that leave. In the Restaurant Industry Award MA000119 it is clause 25, in the Hospitality Industry (General) Award MA000009 it is clause 30, and in the Fast Food Industry Award MA000003 it is clause 22.
All three open with the same sentence: annual leave is provided for in the NES and it does not apply to casual employees. That single line decides most of what leave loading costs a venue. A casual is paid the 25% casual loading instead of leave, so a roster that is mostly casual carries almost no leave loading bill at all. Which award you sit under is worth getting right first, and the coverage clauses are narrower than most operators expect.
In MA000119 and MA000009 it is a flat 17.5%. The two clauses are word for word identical. MA000119 clause 25.3 reads: an employer must pay an employee a loading of 17.5% on the amount payable to the employee under the NES for a period of paid annual leave, including a period of untaken paid annual leave when the employment of the employee ends. MA000009 clause 30.3 says exactly the same thing.
Read from awards.fairwork.gov.au on 21 September 2026: MA000119 clause 25 and MA000009 clause 30, both as varied to apply from the first full pay period on or after 1 July 2026.
Two things follow from that wording and both get missed. The loading is calculated on the amount payable under the NES, which is the base rate the person is actually on, so over award pay raises the loading with it. And the words "including a period of untaken paid annual leave when the employment of the employee ends" are in the clause, so the loading is not something that only applies to leave that gets taken.
Because MA000003 clause 22.2 is not a flat 17.5%. It is a greater-of test, and it is the single most misapplied clause in this part of the award system.
Clause 22.2(a) defines a relevant weekend penalty amount as the applicable weekend penalty rate in clause 21, less the minimum hourly rate. Clause 22.2(c) then says the loading for a period of annual leave is the greater of two amounts: 17.5% of the minimum hourly rate for all ordinary hours the employee would have worked, or the relevant weekend penalty amounts payable for all the ordinary hours they would have worked on a weekend.
| Award | Loading | Clause words about leave untaken at the end of employment |
|---|---|---|
| MA000119 Restaurant Industry | flat 17.5% | expressly included in clause 25.3 |
| MA000009 Hospitality Industry (General) | flat 17.5% | expressly included in clause 30.3 |
| MA000003 Fast Food Industry | the greater of 17.5% or the weekend penalty amounts | not in the loading clause; a note points to section 90(2) of the Fair Work Act instead |
That last column is a statement about what the clause text says, not about what the Act requires. Section 90(2) is a legal question and this page does not answer it. The point for an operator is narrower and useful: if you run a takeaway and a sit-down room under one company, two of your staff can have different leave loading rules on the same payroll.
Worked example, ours, with every input shown so you can follow it. A full time fast food level 2 employee is on A$29.45 an hour from 1 July 2026. They work 38 ordinary hours a week, of which 10 are on Saturday and 10 on Sunday. They take four weeks of leave, so 152 ordinary hours.
| Option | Working | Amount |
|---|---|---|
| (i) 17.5% of the minimum hourly rate | 152 hours x A$29.45 x 17.5% | A$783.37 |
| (ii) Saturday penalty amount | 40 hours x A$29.45 x 25% (Saturday is 125% of the minimum rate, so the penalty amount is 25%) | A$294.50 |
| (ii) Sunday penalty amount, level 2 | 40 hours x A$29.45 x 50% (Sunday for a level 2 is 150%) | A$589.00 |
| Option (ii) total | the award requires the greater of the two | A$883.50 |
So this employee is owed A$883.50, A$100.13 more than the flat 17.5% figure a payroll system will produce if nobody has told it about clause 22.2. The penalty rates are from MA000003 clause 21 Table 6 and the hourly rate from clause 15.1 Table 3.
The shape of the test matters more than the example. A Saturday-only roster can essentially never beat 17.5%, because you would need about 26.6 of a 38 hour week on a single Saturday for the weekend amount to win. The weekend option only takes over when the roster carries real Sunday hours for a level 2 or level 3 employee, where the penalty steps up to 150%.
Ours, and the arithmetic is one line. Four weeks of leave at 17.5% is 0.7 of a week of extra pay per permanent employee per year. Against a 52 week ordinary wage that is 1.35%. So on A$400,000 of permanent ordinary wages, leave loading is about A$5,400 a year.
The number that moves it is not headcount. It is the permanent to casual mix, because casuals accrue no annual leave and therefore no loading. That is the same trade the 25% casual loading already represents, and it sits inside the wider question of what share of turnover your labour should be taking. If you are working out whether a role should be permanent at all, the casual loading arithmetic runs the other way.
Both are in the same annual leave clause and both are easy to miss.
Shutdown notice. MA000119 clause 25.4 and MA000009 clause 30.4 let an employer direct staff to take paid annual leave over a temporary shutdown, but only with 28 days' written notice, or a shorter period agreed with the majority of relevant employees. Deciding on 20 December to close the first week of January does not meet that.
The extra week for shiftworkers. MA000119 clause 25.2 and MA000009 clause 30.2 give a seven day shiftworker the NES additional week of paid annual leave, but only where the employee is regularly rostered on Sundays and public holidays in a business where shifts run continuously 24 hours a day, seven days a week. That is rare in a restaurant and normal in a hotel, which is one more reason the coverage question comes first.
Three steps, in this order. Confirm which award covers the venue, because the loading rule changes with it. Confirm the classification and the base rate the person is actually on, not the minimum, because over award pay raises the loading. Then, if you are on MA000003, run both arms of clause 22.2 for the roster the person actually works rather than assuming 17.5%.
For a named person, use the Fair Work Pay and Conditions Tool rather than any figure on this page. Everything here is the award text and arithmetic on it, dated 21 September 2026, and it is not payroll advice. If your rates for the wider table are what you are after, the MA000009 rates are set out separately and the classification levels sit on their own page.
It comes in through the mix. Leave loading, annual leave, sick leave and notice are all costs that attach to permanent staff and not to casuals, which is why venues carry more casuals than they want to. The usual reason a venue needs another body on shift is not the covers, it is the phone: someone has to be free to answer it through service.
Skai Solutions answers the phone so that person does not have to. It takes bookings, answers the questions callers actually ask and passes a real lead through, which is the difference between being short one person and being short one person and the phone. Setup takes five days.
The other leave entitlement operators look for in the award and cannot find is long service leave, because it is state legislation rather than an award term. All three big states accrue it at the same 0.8667 weeks a year and only the vesting date differs.
The full version of that trade off, what the category does well and where it does not help, is on our page about AI receptionists for Australian and New Zealand venues.
Is annual leave loading compulsory in hospitality? If the award covers the employee and they are permanent, yes. MA000119 clause 25.3 and MA000009 clause 30.3 both say an employer must pay a loading of 17.5%. MA000003 clause 22.2 requires a loading too, calculated differently.
Do casuals get annual leave loading? No. All three awards state that annual leave is provided for in the NES and does not apply to casual employees. The 25% casual loading is paid instead of annual leave and other permanent entitlements.
What is the annual leave loading rate in the Restaurant Award? 17.5%, flat, under clause 25.3, on the amount payable under the NES for the period of leave, and the clause expressly includes untaken leave when employment ends.
Is leave loading paid on leave that is never taken? MA000119 clause 25.3 and MA000009 clause 30.3 both name a period of untaken paid annual leave when employment ends inside the clause. MA000003 clause 22.2 does not use those words and instead carries a note pointing to section 90(2) of the Fair Work Act.
How much notice do I have to give for a Christmas shutdown? 28 days in writing under MA000119 clause 25.4 and MA000009 clause 30.4, or a shorter period agreed with the majority of relevant employees.
Does over award pay increase the loading? Yes. The loading is calculated on the amount payable under the NES, and the note at the head of each annual leave clause points to sections 16 and 90 of the Act on paying the higher rate during leave.